Today, amidst the usual April 1st pranks, Nigerian fintech startup Thepeer announced its closure. This news comes as a surprise to some, but a sobering reminder of the challenges faced by innovative startups in Africa’s developing financial landscape.
Thepeer’s mission was ambitious – to create a seamless way to transfer money between digital wallets and simplify payments. In 2022, it raised $2.1 million in a seed round to achieve this mission.
However, the statement on their website highlights two key roadblocks: compliance and user adoption.
Compliance Challenges Hindered Growth
Thepeer struggled to integrate with key digital wallet providers due to compliance issues. Navigating complex regulations in a rapidly evolving fintech space can be a significant hurdle, especially for smaller startups. This limited their reach and potential user base.
Educating Users About Digital Wallets
Thepeer also points out that widespread adoption of digital wallets as a primary payment method hasn’t happened as quickly as they anticipated. This meant significant resources were dedicated to educating users about the benefits of their platform.
Launched by Kosisochukwu Chike Ononye and Michael ‘Trojan’ Okoh in August 2021, Thepeer offers four main products:
- Direct Charge allows customers of different businesses to fund their wallets from other businesses,
- Send allows customers of businesses to send money to each other instantly,
- Checkout allows customers to pay for items online from any store that accepts payment via Thepeer, and
- Send on the dashboard for businesses to be able to send and receive money from each in seconds, as well as a new currency balance — USD
The company stated that it recorded an average month-on-month transaction growth of 161% since it went live in August 2021 through the first quarter of 2022.
Thepeer says it will be return the capital raised to investors, this decision favoured over two other options of “doing a hard pivot” and an “M&A”.
Thepeer says its operations will be placed on maintenance mode for the interim and they will work to maintain the platform for as long as possible until they discover a new home for it.
